7.  The applicant bank, Zagrebačka banka d.d., is a joint stock company incorporated under Croatian law which has its registered office in Zagreb.
8.  The applicant bank was founded on the basis of a “self-management agreement” (samoupravni sporazum, hereafter “the founding agreement”) concluded on 8 July 1986 between several companies (at the time called “organisations of associated labour”). One of the parties to the agreement, company Textil, contributed, as a founder, some eleven billion Yugoslav dinars (hereafter “the establishment sum”).
9.  It appears that on 24 June 1992 Textil notified the applicant bank of the termination of the above agreement and requested repayment of the establishment sum. As the applicant bank refused to repay, in 1992 Textil brought a civil action in the Zagreb Commercial Court (Trgovački sud u Zagrebu) seeking the refund, plus statutory default interest (zakonska zatezna kamata). The applicant bank replied that during its transformation into a joint stock company in November 1989 it had made the plaintiff its shareholder and assigned to it a certain number of shares corresponding to the establishment sum.
10.  On 7 June 1995 the court delivered a judgment (hereafter “the original judgment”), ruling for the plaintiff. It ordered the applicant bank to pay the plaintiff the principal amount of 1,100 Croatian kunas (HRK) plus statutory default interest. The operative part of that judgment read as follows:
“I. The defendant ZAGREBAČKA BANKA d.d., Zagreb, Paromlinska 2, is ordered to pay the plaintiff TEXTIL import-export d.d. from Zagreb, Šoštarićeva 10, the amount of HRK 1,100 plus statutory default interest in accordance with the applicable regulations stipulating the interest rate and the Interest Rate Act, accruable from 15 September 1986 until the date of payment, as well as the costs of the proceedings in the amount of HRK 900, all within eight days.
II. The alternative claim, for 12,272 shares with the pertaining outstanding dividends, is dismissed.”
11.  The court held that the applicant bank had not been entitled to transform the funds received into shares without Textil’s consent. Thus, Textil had been entitled to terminate the 1986 agreement and request repayment. The applicant bank appealed.
12.  On 31 October 1995 the High Commercial Court (Visoki trgovački sud Republike Hrvatske) dismissed the appeal and upheld the first-instance judgment, endorsing the reasons given therein. The original judgment thus became final.
13.  It appears that the applicant bank did not attempt to lodge an appeal on points of law (revizija) with the Supreme Court against the second-instance judgment, nor did it lodge a constitutional complaint with the Constitutional Court.
14.  On 5 January 2000 the applicant bank filed a petition for reopening of the proceedings with the Zagreb Commercial Court, seeking to have the above first- and second-instance judgments set aside. It argued that Textil had already ceased to exist as a legal entity by 15 March 1994, and therefore after that date did not have standing to sue in the above civil proceedings. In its petition the applicant bank relied on the extract from the register of commercial companies (sudski registar) of 6 December 1999 according to which Textil had been deleted from that register on 15 March 1994 following its incorporation into company Turist Trip d.o.o.
15.  On 13 April 2004 the Zagreb Commercial Court allowed the applicant bank’s petition and set aside its judgment of 7 June 1995 and the judgment of the High Commercial Court of 31 October 1995.
16.  Following an appeal by the plaintiff, on 22 October 2004 the High Commercial Court quashed the first-instance decision and remitted the case.
17.  In the resumed proceedings, on 8 February 2006 the Zagreb Commercial Court declared the applicant bank’s petition for reopening inadmissible as belated. In particular, the court established that the applicant bank had already become aware of the facts on which it had based its petition for reopening by 23 December 1998, whereas it had filed that petition on 5 January 2000, that is, outside the statutory time-limit of thirty days. In the absence of appeals that decision became final on 27 February 2006.
18.  Meanwhile, on 18 December 1995 Textil, as the original judgment’s creditor, concluded an assignment contract (ugovor o cesiji) by which it assigned its claim against the applicant bank to company Texhol d.o.o. The signatures of the directors of the two companies on the assignment contract were certified by a notary public. The majority stockholder of Textil and the sole shareholder of Texhol (as well as of Turist Trip) was a certain Mr A.K.
19.  The applicant bank disputed the validity of that assignment contract, claiming that on 15 March 1994 Textil had ceased to exist as a legal entity following its incorporation into Turist Trip company (see paragraph 14 above). On 4 May 1998 it instituted separate civil proceedings for that contract to be declared non-existent, and eventually, on 16 October 2007, obtained a final judgment in its favour (see paragraphs 88-94 below).
20.  In the meantime, on 15 January 1996 Texhol applied to the Zagreb Commercial Court for enforcement of the original judgment.
21.  On 26 January 1996 that court issued a writ of execution (rješenje o izvršenju). It ordered the financial institution operating the applicant bank’s account, which was at the time the Domestic Payment Transfer Agency (Zavod za platni promet subsequently renamed Financijska agencija – hereafter “ZAP” or “FINA”), to collect the amount corresponding to the judgment debt and transfer it to Texhol’s account. The writ read as follows:
“I. The debtor is ordered to pay the creditor’s claim in the amount of HRK 1,100 plus statutory default interest in accordance with the applicable regulations stipulating the interest rate and the Interest Rate Act, accruable from 15 September 1986 until the date of payment, as well as the costs of the [civil] proceedings in the amount of HRK 900.
II. The debtor is ordered to reimburse the creditor the costs of these [enforcement] proceedings, as well as to pay statutory default interest on the amount of those costs accruable from the date of the issuance of the writ of execution until satisfaction of the creditor following the service of the writ.
III. In order to satisfy the creditor’s claim referred to under paragraph I. of this writ of execution
t h e e n f o r c e m e n t i s a l l o w e d
to the debit of the account of the debtor ZAGREBAČKA BANKA d.d. held with ZAP Zagreb, giro account no. [...], and to the credit of the creditor TEXHOL, giro account no. [...] held [also] with ZAP Zagreb, and in accordance with the assignment agreement between TEXTIL import-export d.d. and TEXHOL d.o.o. of 18 December 1995.
ZAP is ordered to carry out this writ by transferring the funds from the debtor’s giro account no. [...] with ZAP Zagreb to the creditor’s giro account no. [...] with ZAP Zagreb.
Should there be no funds in the debtor’s giro account, ZAP shall freeze the account and effect the payment as soon as funds are available.”
22.  On 31 January 1996 the applicant bank objected (prigovor) to the writ. In its objection the applicant bank disputed the validity of the assignment contract between Textil and Texhol of 18 December 1995, claiming that on 15 March 1994 Textil had ceased to exist as a legal entity following its incorporation into company Turist Trip d.o.o. (see paragraph 19 above). As the writ of execution was not based solely on the original judgment as the enforcement title (izvršna isprava), but also on the assignment contract designated as the supplementary enforcement title (dopunska izvršna isprava), the applicant bank argued that Texhol was not entitled to seek enforcement of the original judgment.
23.  On 8 February 1996 the Zagreb Commercial Court dismissed the applicant bank’s objection. Relying on section 22(1) of the Enforcement Proceedings Act, the court held that because the assignment contract had been certified by a notary public the applicant bank’s argument that the judgment debt had not been validly transferred to Texhol could not be accepted until proven otherwise by a final court judgment (see paragraph 146 below). The applicant bank appealed against that decision.
24.  On 12 March 1996 the High Commercial Court dismissed the applicant bank’s appeal and upheld the first-instance decision, endorsing the reasons given therein.
25.  The calculation of statutory default interest on the principal amount of HRK 1,100 made by ZAP in the execution of the writ gave a total amount of HRK 5,416,078.56. On 12 February 1996 ZAP seized that amount from the applicant bank’s account and transferred it to Texhol’s account.
26.  On an unspecified date in February 1996 Texhol’s advocate wrote to ZAP complaining that the interest for the period between 9 December 1988 and 6 October 1989 had been calculated incorrectly because the “revaluation interest” had not been taken into consideration.
27.  In its reply of 26 February 1996 ZAP responded that the interest had been calculated correctly. It explained:
“In your complaint you requested the application of another type of interest, namely revaluation interest, the rate of which is different from statutory interest, and which was not expressly stipulated in the writ of execution, so we cannot calculate it.”
28.  On 6 March 1996 Texhol applied to the Commercial Court, asking it to continue the enforcement because ZAP had miscalculated the amount of statutory default interest due. Texhol argued that ZAP had used the simple instead of the compound method and that it had not taken “revaluation interest” into account.
29.  On 9 June 1997 the court issued a decision ruling for Texhol. It ordered ZAP to recalculate the statutory default interest by taking revaluation interest into consideration and by using the compound method, and thereafter to satisfy the remainder of Texhol’s claim. The applicant bank appealed, arguing that it had not been informed of Texhol’s application to continue the enforcement nor of the resultant decision of the Commercial Court.
30.  On 23 December 1997 a panel of the High Commercial Court, composed of judges Z.J., R.S. and L.Ć., dismissed the appeal and upheld the first-instance decision. On 9 March 1998 the State Attorney lodged a request for protection of legality (zahtjev za zaštitu zakonitosti) to the Supreme Court against the second-instance decision.
31.  On 9 September 1998 the Supreme Court allowed the request, quashed the lower courts’ decisions for procedural errors, and remitted the case to the first-instance court. It held that the principle of adversarial hearing had been breached because the applicant bank had not been given the opportunity to comment on Texhol’s application to continue the enforcement. It also instructed the lower courts to establish the type of statutory default interest (depending whether the founding agreement constituted a contract of a commercial or non-commercial nature) as well as its rate and method of calculation (simple or compound) in the resumed proceedings. The relevant part of that decision read as follows:
“The enforcement court should have decided on the amount of interest claimed, that is, on the type of the statutory default interest, the rate and the method of calculation of the statutory default interest.
...
Texhol do.o. is entitled to conduct the enforcement proceedings, which follows from the enclosed written assignment contract in which the signatures of the parties were certified by a notary public. [T]that document is a document certified in accordance with the law within the meaning of section 22 of the Enforcement Procedure Act, which entitles the assignee to [act as an enforcement creditor in] the enforcement proceedings ...
Until the entry into force of the [1989] Amendments to the Obligations Act, which entered into force on 7 October 1989, the default interest rate accruable on claims arising from the [legal] relationships between persons performing an economic activity was prescribed by decisions on the statutory default interest rate, pursuant to section 277(2) of the Obligations Act, whereas the [statutory default] interest rate on other claims for payment of a sum of money was determined by inter-bank self-management agreements, pursuant to section 277(1) of the Obligations Act.
In the resumed proceedings it is necessary for the court to decide on the type of default interest up to 7 October 1989, taking into account the [legal] relationship between the parties, because the type of statutory default interest was not specified in the enforcement proceedings, then on the rate of the statutory default interest from 15 September 1986 onwards, as well as on the method of calculation of the default interest.”
32.  On 28 September 1999 Texhol d.o.o. was renamed Retag d.o.o.
33.  In the resumed proceedings, on 5 November 1999 the Commercial Court decided to obtain the opinion of a financial expert, and on 12 November 1999 instructed the expert to calculate the statutory default interest, bearing in mind that, in the court’s view, the founding agreement was to be qualified as commercial.
34.  On 11 January 2000 the court delivered a decision ordering ZAP to transfer from the applicant bank’s account the remaining amount of the creditor’s claim of HRK 263,077,597.48 plus statutory default interest accruable from 24 November 1999 until payment. The court dismissed the applicant bank’s arguments that the creditor’s claim had already been satisfied in full on 12 February 1996 and that the assignment contract of 18 December 1995 was not valid.
35.  On 14 February 2000 the applicant bank appealed against that decision to the High Commercial Court, at the same time asking for the enforcement to be postponed. Three days later the applicant bank submitted a motion for judges Z.J., R.S. and L.Ć. to withdraw, because they had sat in the panel of that court which, on 23 December 1997, had dismissed its previous appeal (see paragraph 30 above). It also requested withdrawal of the High Commercial Court’s president N.Š. On 19 April 2000 the Supreme Court dismissed the applicant bank’s motion for withdrawal of the High Commercial Court’s president, N.Š., whereupon, on 2 May 2000, he dismissed the motion for withdrawal of judges Z.J., R.S. and L.Ć.
36.  In addition, on 6 March 2000 the applicant bank lodged a constitutional complaint against the first-instance decision of 11 January 2000, at the same time asking the Constitutional Court to issue an interim measure that would postpone the enforcement.
37.  On 3 March 2000 the Commercial Court allowed the applicant bank’s motion and postponed the enforcement. However, on 16 May 2000 a panel of the High Commercial Court, composed of judges Z.J., N.Š. and R.S., allowed Retag’s appeal and reversed the first-instance decision by dismissing the applicant bank’s motion for postponement.
38.  On the same day the same panel of the High Commercial Court also dismissed the applicant bank’s appeal against the Commercial Court’s decision of 11 January 2000 (see paragraphs 34-35 above).
39.  On 23 May 2000 the applicant bank lodged a constitutional complaint against that second-instance decision, alleging violations of its constitutional rights to appeal, fair hearing, equality before the law and of ownership.
40.  On the same day the Constitutional Court allowed the motion for an interim measure submitted on 6 March 2000 and postponed the enforcement until it had decided on the applicant bank’s constitutional complaint of 23 May 2000.
41.  On 13 December 2000 the Constitutional Court allowed that constitutional complaint and quashed the decision of the Zagreb Commercial Court of 11 January 2000 (see paragraph 34 above) and the decision of the High Commercial Court of 16 May 2000 (see paragraph 38 above). It found violations of the applicant bank’s constitutional rights to appeal, fair hearing and equality before the law, but not of its constitutional right of ownership. The case was remitted to the Zagreb Commercial Court for the second time. 3.  Continuation of the enforcement: third attempt
(a)  The proceedings leading to the decision of 3 October 2003 and the subsequent remedies
42.  In the resumed proceedings, on 10 July 2003 the Zagreb Commercial Court issued an instruction (zaključak) inviting the parties to lodge written submissions. By another instruction, of 1 September 2003, the court forwarded Retag’s submissions of 23 July 2003 to the applicant bank and scheduled a hearing for 23 September 2003. The applicant bank submitted that these instructions were never served on it and that consequently neither of its two representatives in the proceedings (a corporate lawyer and an advocate) attended the hearing.
43.  The hearing was nevertheless held as scheduled, in their absence. The judge appointed to hear the case noted in the record of the hearing that receipt of the letter containing summons for the applicant bank’s corporate lawyer I.T. had not been acknowledged, whereas the same letter sent to the applicant bank’s advocate D.J. had been returned with an “out of office” stamp. The judge also recorded in the record that the day before the hearing he had telephoned the advocate’s office and left a message with an employee that the hearing was scheduled for the following day.
44.  On 3 October 2003 the Commercial Court issued a decision, the relevant part of which read as follows:
“III. On the basis of a ... decision of this court. ... of 26 January 1996 ... the Croatian National Bank is ordered to calculate the creditor’s claim in the amount of HRK 1,100, together with the following interest:
- for the period from 15 September 1986 to 6 October 1989, interest at the rate [usually] paid at the place of performance on time savings deposits with no established purpose and with a term longer than one year, pursuant to section 277(1) of the Obligations Act;
IV. When calculating the interest the Croatian National Bank is required to deduct from the sum arrived at on 12 February 1996 the amount of HRK 5,416,078 ...
45.  In deciding the above the court took into consideration the creditor’s written pleadings of 25 July 2003, as well as the written pleadings of the applicant bank of 26 September 2003. It stressed that the issue of which interest rate was to be applied was of a legal rather than a technical nature. It qualified the founding agreement as a non-commercial contract, thereby effectively sidestepping the contestation as to the applicability of “revaluation interest” (see paragraphs 26-29 above), because that interest could only potentially be applied to claims arising out of commercial contracts. However, the court did not indicate the exact rate to be applied, but merely stated that it was the “interest at the rate paid at the place of performance on time savings deposits with no established purpose and with a term longer than one year” (kamatu po stopi koja se u mjestu ispunjenja plaća na štedne uloge oročene bez utvrđene namjene preko godinu dana). Nor did the court indicate the method of calculation of statutory default interest (simple or compound). Nonetheless, the court stated that in the period between 15 September 1986 and 6 October 1989 the statutory default interest rate stipulated in section 277(1) of the 1978 Obligations Act as in force at that period (see paragraph 126 below) had been calculated pursuant to the Inter-Bank Interest Rate Policy Self-Management Agreement (see paragraphs 133-137 below).
46.  On 14 October 2003 the applicant bank appealed to the High Commercial Court against that decision, asking at the same time for its execution to be postponed. In requesting postponement of enforcement the applicant bank argued that Retag’s claim against it had been extinguished by offsetting (prijeboj) the applicant bank’s claim against Textil for payment of HRK 14,921,617.82, together with interest on that amount calculated from 1 March 1993. It explained that over a number of years it had lent substantial sums of money to Textil, which had later been unable to repay those loans. Given that Textil had been incorporated into Turist Trip company on 15 March 1994, and that it had, on 18 December 1995, assigned the claim against the applicant bank to Texhol (later named Retag), the applicant bank had been entitled to offset its claim against Textil with Retag’s claim against the applicant bank, pursuant to section 440(2) of the 1978 Obligations Act, which entitled the debtor in the event of assignment to offset its debt against a claim existing at the time of assignment against either the assignor or the assignee (see paragraph 130 below). The applicant bank also requested that judges R.S., Z.J. and L.Ć., as well as the President of the High Commercial Court, N.Š., withdraw. In so doing the applicant bank merely stated that those judges had previously been involved in decision-making in the case, and that it had lodged several criminal complaints against them, which had not been decided on to that date. For that reason the applicant bank argued that it had cause to doubt their impartiality.
47.  Retag, for its part, also appealed against the first-instance decision of 3 October 2003, insisting on the application of “revaluation interest” and the compound method.
48.  On 13 October 2003 the applicant bank also lodged, and on 14 and 29 October 2003 supplemented, a constitutional complaint against the first-instance decision, asking at the same time for postponement of enforcement.
49.  On 27 October 2003 the Zagreb Commercial Court dismissed the applicant bank’s motion of 14 October 2003 for postponement of enforcement (see paragraph 46 above). At the same time the court also instructed the applicant bank to institute separate civil proceedings for the enforcement to be declared inadmissible (parnica za proglašenje ovrhe nedopuštenom), given that in its appeal of the same date the applicant bank argued, inter alia, that the continuation of enforcement of the original judgment was inadmissible because Retag’s claim against it had been extinguished by the offset of its claim against Retag. The applicant bank instituted those proceedings on 11 November 2003 (see paragraphs 113-116 below). The relevant part of that decision reads as follows:
“The motion for postponement of enforcement is based on the [enforcement] debtor’s argument that the [enforcement] creditor’s claim was extinguished by an offset, which does not constitute a ground for postponing the enforcement.
Moreover, the [enforcement] debtor’s mere contention that it has a larger claim against the [enforcement] creditor does not constitute significant damage, as has been established by the case-law of the [domestic] courts.
Apart from the fact that the [enforcement] creditor’s claim is based on an enforcement title, whereas the [enforcement] debtor does not possess any decision in its favour, it has to be noted that the [enforcement] debtor could have relied on such a defence earlier, during the [principal] civil proceedings.
In this court’s view, no one should benefit from evident abuse of process during proceedings. Therefore, the motion for postponement of enforcement must be dismissed.”
50.  On 8 December 2003 the President of the Commercial Court declared the applicant bank’s motion for withdrawal of judges N.Š., R.S., Z.J. and L.Ć. of 14 October 2003 inadmissible (see paragraph 46 above). In so doing she relied on section 73 of the Civil Procedure Act (according to which once a court has decided on a motion for withdrawal, any subsequent motions for withdrawal of the same judges in the same proceedings are to be declared inadmissible, see paragraph 145 below), and the fact that earlier in the same proceedings, on 19 April 2000, the Supreme Court had already dismissed a motion for withdrawal of Judge N.Š, and on 2 May 2000 the High Commercial Court had dismissed a motion for withdrawal of judges R.S., Z.J. and L.Ć (see paragraph 35 above).
51.  On 6 April 2004 the High Commercial Court, sitting in a panel composed of judges Z.M., R.S. and K.M., dismissed appeals against the first-instance decision of 3 October 2003, endorsing the reasons given therein. It also dismissed the applicant bank’s appeal against the first-instance decision of 27 October 2003 refusing its motion for postponement of enforcement. It held as follows:
“As a ground for postponement of enforcement the [enforcement] debtor states that it intends to lodge an appeal. However, no valid grounds for postponement of enforcement are discernible from the appeal ...
As regards the argument in the appeal concerning the lack of capacity to act as the [enforcement] creditor, the court finds that [Retag] is entitled to act in that capacity on the basis of the assignment contract [of 18 December 1995] until proven otherwise by a final judgment. ... [T]he case file contains a written assignment contract with the parties’ signatures, certified by a notary public. [T]hat document is a deed certified in accordance with the law within the meaning of section 22 of the Enforcement Procedure Act, which entitles the assignee to act [as the enforcement creditor] in the enforcement proceedings. [Since] enforcement proceedings are strictly formal, this court has full confidence in the certified notarial deed ...
It has to be noted that the first-instance court correctly found that the enforcement debtor had received from the enforcement creditor’s predecessor a sum which represented the equivalent of 56 million German marks, had used it from 1986 until the present day, and had refused to return it despite the final court judgments. Furthermore, the enforcement debtor claims that the payment of HRK 5,416,078, which represents about 3% of the value of the principal debt on the day the debt became due, had settled the debt in full.
During these enforcement proceedings seven first-instance decisions were rendered postponing enforcement in this case, as well as eleven decisions on motions for withdrawal of certain judges of the Commercial Court, the High Commercial Court and the Supreme Court.
The case file contains six decisions of the High Commercial Court, two decisions of the Supreme Court [and] two decisions of the Constitutional Court, neither of which concerns motions for withdrawal of judges. Despite all this the enforcement creditor has not managed to satisfy its claim [endorsed by a final court judgment].
It follows from all of the above that the enforcement debtor’s appeal is ill-founded and thus must be dismissed ...”
52.  On 2 June 2004 the applicant bank lodged a constitutional complaint against that decision, alleging violations of its constitutional rights to appeal, fair hearing and equality before the law.
53.  In addition, on 14 June 2004 the State Attorney lodged a request for protection of legality against the same decision.
54.  On 4 October 2004 the Commercial Court declared the State Attorney’s request inadmissible, finding that such a remedy no longer existed under the relevant legislation. On 18 January 2005 the High Commercial Court dismissed an appeal by the State Attorney and upheld the first-instance decision.
55.  On 7 July 2005 the Constitutional Court declared the applicant bank’s constitutional complaint inadmissible, finding that the decision complained of was unrelated to the merits of the case.
(b)  The proceedings leading to the instruction of 28 October 2003 and the subsequent remedies
56.  Meanwhile, on 14 October 2003 the Croatian National Bank wrote to the Commercial Court explaining that it was unable to calculate the statutory default interest as indicated in that court’s decision of 3 October 2003 (see paragraphs 44-45 above) because it did not have the necessary information about interest rates on time savings deposits or the text of the Inter-Bank Interest Rate Policy Self-Management Agreement referred to in that decision. However, it had asked several banks to provide that information and notified the court that it would proceed with the execution of the court’s decision as soon as it had received the necessary data. The applicant bank submits that that letter was never served on it.
57.  On 16 and 20 October 2003 Retag asked the Commercial Court to expedite the proceedings and informed it that the Croatian National Bank had not yet transferred the funds from the applicant bank’s account.
58.  On an unspecified date in October 2003 the judge of the Commercial Court appointed to hear the case wrote to ZAP (which had in the meantime been renamed the Financial Agency, or FINA) informing it of the Croatian National Bank’s inability to calculate the statutory default interest owing to the lack of necessary information concerning interest rates on time savings deposits. It requested FINA to provide that information and to calculate the statutory default interest as indicated in the Commercial Court’s decision of 3 October 2003.
59.  On 27 October 2003 FINA made the calculation as requested and forwarded it to the Commercial Court. The calculation suggests that the simple interest method was used to calculate the statutory default interest in the period between 10 August 1986 and 31 December 1987, whereas the compound interest method was used in the period between 1 January 1988 and 27 October 2003. The amount was therefore determined at HRK 165,167,676.75.
60.  The applicant bank submits that neither the Commercial Court’s request nor FINA’s calculation were ever served on it.
61.  On 28 October 2003 the Commercial Court issued an instruction to the Croatian National Bank to transfer, pursuant to FINA’s calculation, the amount of HRK 165,167,676.75 from the applicant bank’s account to Retag’s account. The instruction was served on the applicant bank on 24 November 2003.
62.  On 22 December 2003 the Croatian National Bank transferred the sum of HRK 168,618,419.60 pursuant to the instruction (the difference between the sum indicated in the instruction of 28 October 2003 and the sum transferred on 22 December 2003 is due to the accrued statutory default interest in the period between the date the instruction was issued and the date the sum was transferred).
63.  On 2 December 2003 the applicant bank appealed against the instruction of 28 October 2003 to the High Commercial Court notwithstanding the fact that no appeal was available against such a decision under Croatian law (see section 8(7) of the 1978 Enforcement Procedure Act in paragraph 146 below). It appears that no formal decision (to declare it inadmissible) has ever been taken on that appeal. At the same time it again asked for postponement of enforcement and withdrawal of judges N.Š., R.S., Z.J. and L.Ć.
64.  On 24 November 2003 the applicant bank also lodged, and on 2 and 18 December 2003 supplemented, a constitutional complaint against the instruction, asking at the same time for its enforcement to be postponed. On 14 April 2004 the Constitutional Court declared that complaint inadmissible, holding that the contested decision was unrelated to the merits of the case.
65.  On 28 August 2008 the Zagreb Commercial Court issued a decision to discontinue the enforcement proceedings, given that the enforcement was completed and that Retag as the enforcement creditor had on 12 December 2007 ceased to exist as a legal entity (see paragraph 87 below).
66.  Following an appeal by “the bankruptcy estate of Retag” (see paragraphs 87 and 155-156 below), on 14 October 2008 the High Commercial Court quashed the first-instance decision and instructed the lower court to stay the enforcement proceedings pursuant to section 212(4) of the Civil Procedure Act (see paragraph 145 below).
(c)  Statements to the media by Judge N.Š.
67.  Meanwhile, on 6 November 2003 N.Š., a High Commercial Court, judge and its president in the period between 6 March 1995 and 6 March 2002, had been quoted in a newspaper article published by the daily Novi list in which he had made certain comments that, in the applicant bank’s view, were injudicious and hostile. The article, featuring a photo of Judge N.Š. and entitled ‘[N.Š]: ZABA has to pay at least 28 million euros pursuant to the writ of execution’, the relevant part of which read as follows:
 “‘The principal debt of 56 million German marks (28 million euros) is indisputable – the question is only how the interest should be calculated’, explains the former President and now judge of the High Commercial Court of the Republic of Croatia [N.Š.], against whom Zagrebačka banka has already brought criminal charges in 2001 in which it attempted to prove that [he] had abused his judicial authority in a case that may bring the bank to its knees due to enormous default interest accrued as a result of 11 years of court proceedings.
...
[N.Š.] however emphasises that the bank could have pre-empted all of this if it had [re]acted in time: ‘Enforcement has already been ordered three times, and each time the matter has been deliberately blurred by the amounts of principal debt and interest [being incorrect]. As far as I know, [the first-instance judge appointed to hear the case] last ordered the enforcement in the amount of 187 million kunas, whereas FINA calculated an amount several times higher due to the application of what is called the compound method of calculating interest. The bank itself calculates interest for its debtors in the same manner it complains against. I neither know, nor have I seen, let alone am connected to, the people from Textil. I have personally brought charges against an ‘anonymous person’ in Zaba. If the allegations in the criminal complaints [against me] were true, I can assure you that the State Attorney’s Office would have taken action against me’, Š. argues.”
68.  On 24 March 2006 Judge N.Š. participated in the television programme ‘Kontraplan’ broadcast by Croatian Television. The relevant part of that programme was as follows:
“Narrator: Banks are bigger mafia than small and big criminal organisations, said N.Š., judge and former president, after failing to be elected President of the High Commercial Court. As well as banks, N.Š. has also assailed the State Attorney’s Office, judges of the Supreme Court and politicians. He has accused J.C. of favouring his son I.C., who after having been an advocate of Zagrebačka banka, became the President of the Supreme Court. He has accused S.L. of putting pressure on the Court together with bankers, and B.G. of tearing up a Commercial Court judgment. In addition, N.Š. suspects State Attorney M.B. of keeping judges obedient by not dealing with numerous criminal complaints against them. D.M. (host): N.Š.’s frontal attack on the pillars of Croatian banking, as well as the judicial and political system, has raised several important issues. Should one trust [his] thesis that the Croatian economy is a hostage to corrupt lobbies? Are the answers given by those mentioned convincing, and which institutions in Croatia are going to assess them? Are N.Š.’s accusations confirmation to Eurocrats that Croatia really has a corrupt judiciary? Is it all about a play of the untouchables, in which no one is going to face the consequences? Tonight’s guest on ‘Kontraplan’ is: Judge N.Š., who is in his office in the High Commercial Court. Good evening, Mr Š.
... D.M.: Most of the public has perceived N.Š.’s reactions and accusations as revenge for not being elected President of the High Commercial Court. One of those mentioned, a former president of the Constitutional Court, who has been accused by N.Š. of favouring one party in the case of Zagrebačka banka versus Retag, shares this opinion. J.C. (former Constitutional Court President): Everything said about Zagrebačka banka is totally untrue. I had a rule, and this was also a rule at the Constitutional Court, under which we always removed ourselves from every case in which a relative or someone else [connected with us] appeared in any role, such as that of an advocate. For example, my son was also a judge in the Supreme Court. Nevertheless these rulings also came to us and we always and in each case of this kind removed ourselves. No offence, but I think this is just dirt and one can only be disgusted by it. One can see this only as the cry of a desperate man who has failed in something, for example, here in becoming the President of the High Commercial Court, and who thinks he can entangle people and involve them among those he has probably worked with. D.M.: Mr Š., why does everybody, or most of the people, especially those who have been invited here, see your acts, that is your attacks, as the act of a desperate man who has lost all chance of getting a better position in the judiciary? N.Š.: Right at the beginning I would like to say that I was trying to talk about these issues while I was the president of the Court, however ...
... D.M.: I am sorry but what did you say? What did you try to draw attention to in these public appearances? N.Š. : I was trying to draw attention to the fact, and that was my point all along, that there is no independent judiciary, that the executive authority influenced it strongly; different lobbies influenced the operation of the courts. It was pretty obvious. I have written about it even today.
... D.M.: ... I would like to go back now to the main case, for which Mr N.Š. has also been attacked very often, and that is the Retag versus Zagrebačka banka case or the 169,000,000 kunas enforcement. In tomorrow’s Večernji list, Mr N.Š., with reference to you, the newspaper claims that father and son [J. and I.] C. saved Zagrebačka banka from enforcement in the Retag case in one day. Allegedly, it happened on 23 May 2000 ... Why did you find this case interesting? Was it, perhaps, evidence of an efficient judiciary and a good advocate? N.Š.: Well, a good advocate was also important, but the problem was the fact that Zagrebačka banka lost this case. It lost it at all levels, not only at the High Commercial Court, but also at the Supreme Court. Therefore, it [i.e. the bank] had to execute it [i.e. the judgment]. However, [the director of Zagrebačka banka] Mr P.L. and Zagrebačka banka [itself] did not want that. Enforcement commenced which lasted about eleven years; it was the longest enforcement in our history. At the same time, Zagrebačka banka did not want to abide by the decision in any way and tried not to do so, which was its legal right, but ...
... N.Š.: ...You see, Zagrebačka banka, for example, has calculated such interests to its depositors, debtors, customers, which it did not want to pay to its creditor. Therefore, two types of criteria [i.e. double standards] were applied here. One type of criteria was used when I was a creditor and the other when it was someone else. In addition to this, I would like to say one more thing. N.Š.: In addition to this, through fiduciary contracts and security instruments for a debt in the amount of 100 kunas, for example, Zagrebačka banka used to take properties, the value of which was well above this amount. Therefore, we cannot say now that it was impeccable and that it did not take a significant part of the GDP in this way
... N.Š.: First of all, ... I would like to say that I have never acted as judge in this case – so that you can get me right. I was only the president of the court and they have attacked me. Zagrebačka banka has attacked me according to the command responsibility, I guess, because I could have, they believe, influenced it. D.M.: But, Mr N.Š., I have to interrupt, in tomorrow’s Večernji list you have attacked the relationship between J. and I.C, although, for example, J.C. was no longer at the [Constitutional Court] at the time of the one-day postponement of enforcement. He was retired. Therefore, you, too, have to accept some things as a criterion. As the court president you could probably have influenced these things? N.Š.: Well, I could [to] some [extent]. For example, as president I could talk to a judge to speed something up or not. You have to know that the whole system of commercial courts is complex, that there are, you know it yourself, many courts. Even I cannot know them all. Therefore, I cannot or could not know what was happening at a particular court. So, when it comes to that, I did get some information that I could not have influenced. When it comes to the relationship between Zagrebačka banka and courts, for example, the best example is the fact that Zagebačka banka has won 85% of its cases ...
... D.M.: All right. Mr N.Š., let us go back to the Retag case. You have often been reproached for a connection with B.P., that is, with the man who has been connected with what has been called a ‘big criminal organisation’. What is your relationship with him? Does this have anything to do with the fact that you have awarded enforcement in the amount of 169,000,000 kunas to Retag? N.Š.: Well, I have been constantly attacked. Allegedly, I have connections with B.P., then H.P., then ... I have served as a judge for thirty years. For thirty years I have been working in this commercial judiciary sector. I know a great many people. This is how I know B.P. and H.P. I know [the director of Zagrebačka banka] P.L., [the director of Privredna banka] B.P. and so many others, as well. Therefore, these are insinuations used only to exert pressure on the court, so that the court does not issue a ruling in favour of, that is, against ...
... D.M.: All right... one more question. In tomorrow’s Večernji list it is stated, Mr N.Š., that you said, if this is true, you can deny it later, that you knew B.P., about whom we have talked, as a nephew of one of the judges of the High Commercial Court. Is this correct? D.M.: You, Mr N.Š. So, is it true that you know B.P. as a nephew of one of the High Commercial Court judges?
69.  Meanwhile, on 21 June 2000 the Karlovac Commercial Court (Trgovački sud u Karlovcu) decided to open bankruptcy proceedings against Retag. By the same decision the court appointed a bankruptcy administrator and invited Retag’s creditors to report their higher-ranking claims to him within twenty days of publication of the decision to open bankruptcy proceedings in the Official Gazette. The notice was published in the Official Gazette of 7 July 2000.
70.  On 21 July 2000 the applicant bank, as a bankruptcy creditor (stečajni vjerovnik) reported to the bankruptcy administrator the claim against Retag of HRK 11,422,427.08 as a higher-ranking claim, which corresponds to the amount seized from it in the enforcement proceedings on 12 February 1996 (HRK 5,416,078.56) and the statutory default interest accrued on that amount up to the date of the opening of the bankruptcy proceedings (HRK 6,006,348.52).
71.  At the verification hearing (ispitno ročište) held on 30 November 2001 the bankruptcy administrator contested that claim. The court therefore instructed the applicant bank to resume the civil proceedings it had instituted on 4 May 1998, in order to establish whether the claim was well-founded (see paragraphs 19 and 88-94 below).
72.  On 22 February 2004 the bankruptcy administrator prepared the final distribution list (završni diobni popis).
73.  By a decision of 12 March 2004 the bankruptcy judge approved the final distribution and scheduled the final (distribution) hearing (završno ročište) for 15 April 2004. The decision was published in the Official Gazette of 24 March 2004.
74.  On 15 April 2004 the court held the final hearing to review the final distribution list. The applicant bank lodged an objection (prigovor) to the list, stating that unjust enrichment of the bankruptcy estate had occurred in the amount seized from it in the enforcement proceedings on 22 December 2003, and that a number of proceedings to contest the enforcement were still ongoing. The bankruptcy judge dismissed the applicant bank’s objection. However, that decision was subsequently quashed by the High Commercial Court and the case was remitted.
75.  In the resumed proceedings, on 13 September 2004 the bankruptcy judge of the Karlovac Commercial Court issued a decision inviting Retag’s creditors to report their lower-ranking claims to the bankruptcy administrator within fifteen days of publication of the decision in the Official Gazette. The decision was published in the Official Gazette of 24 September 2004.
76.  On 19 September 2004 the sole shareholder of Retag (who was also the sole shareholder of Turist Trip and the major stockholder of Textil), Mr A.K., died.
77.  At the verification hearing for the lower-ranking claims held on 29 October 2004 the applicant bank, as a bankruptcy creditor, reported to the bankruptcy administrator two lower-ranking claims against Retag: (1) for payment of HRK 8,156,264.47, which corresponds to the statutory default interest on the amount seized from it in the enforcement proceedings on 12 February 1996, accrued in the period between the date of the opening of the bankruptcy proceedings and the date the claim was reported, and (2) for payment of HRK 610,610, corresponding to the costs of the bankruptcy proceedings incurred by the bank.
78.  By a decision of 23 November 2004 the bankruptcy judge approved the new final distribution list, prepared by the bankruptcy administrator on 22 November 2004, and scheduled the final hearing for 23 December 2004. That decision was published in the Official Gazette of 1 December 2004.
79.  On 22 December 2004 the applicant bank informed the bankruptcy administrator and the bankruptcy judge that it had on the same day brought a civil action for unjust enrichment against Retag in the Karlovac Commercial Court, seeking restitution of the HRK 168,618,419.60 (see paragraph 106 below) which had been seized from it a year ago and transferred to Retag’s account in the enforcement proceedings.
80.  On 23 December 2004 the applicant bank raised an objection to the final distribution list. The applicant bank explained that it had a claim against the bankruptcy debtor for restitution of HRK 168,618,419.60 on account of unjust enrichment and that it had instituted civil proceedings to that end. Given that the seizure of the amount in question had taken place in the enforcement proceedings on 22 December 2003, that is, after the opening of the bankruptcy proceedings against Retag on 21 June 2000, the applicant bank had become a creditor of the bankruptcy estate (vjerovnik stečajne mase). Under the Bankruptcy Act claims of such creditors had precedence over bankruptcy creditors (stečajni vjerovnici), that is, those creditors whose claims against a bankruptcy debtor had arisen before the opening of bankruptcy proceedings. The applicant bank argued that its claim was well-founded because the enforcement proceedings and the resultant seizure of the above sum had been based on the non-existent assignment contract between Textil and Texhol of 18 December 1995, the validity of which was being contested in parallel civil proceedings. That being so, the applicant bank argued that the bankruptcy administrator should have reserved an amount corresponding to its claim, pursuant to section 87a of the Bankruptcy Act (see paragraph 155 below), and deposited it in a special account pending the outcome of the civil proceedings for unjust enrichment instituted on 22 December 2004, which were expected to end in the bank’s favour. Since the bankruptcy administrator had not (and, having been informed of the bank’s claim a month after he had prepared the final distribution list, could not have) done so, the applicant bank invited the bankruptcy judge to set aside the measures taken so far, take steps to protect the bank’s interests as a creditor of the bankruptcy estate, and fix another date for the final hearing.
81.  On 23 December 2004 the bankruptcy judge of the Karlovac Commercial Court dismissed the applicant bank’s objection to the final distribution list. The relevant part of that decision reads as follows:
“At the final hearing held on 23 December 2004 the objection to the final [distribution] list was lodged by the creditor Zagrebačka banka d.d.
It was argued in the objection that the final [distribution] list did not take into account other obligations of the bankruptcy estate, which had precedence over the payment of bankruptcy creditors. In particular, that it [i.e. the final distribution list] did not take into account the claim of the creditor of the bankruptcy estate Zagrebačka banka d.d. for restitution of the funds acquired by unjust enrichment in the amount of HRK 168,618,419.60, which had been seized on 22 December 2003 in enforcement proceedings I-40/96 before the Zagreb Commercial Court. Furthermore, that the decisions of the enforcement court in favour of the bankruptcy debtor were not final, that the creditor Zagrebačka banka d.d. had instituted civil proceedings P-270/03 before this court for declaring the enforcement inadmissible, that the Zagreb Commercial Court, in its decision P-4885/03 of 13 April 2004, had allowed the petition of the Zagrebačka banka d.d for reopening of proceedings, that the creditor of the bankruptcy estate Zagrebačka banka d.d had instituted civil proceedings P֊91/04 before the Karlovac Commercial Court against the bankruptcy debtor with a view to having the [supplementary] enforcement title declared non-existent and to recover what had been received by unjust enrichment. Furthermore, that by final decision Kv-208/04-2 of 22 March 2004 the Zagreb County Court had issued a provisional measure prohibiting payment of the [above] amount to the accused A.K, as the only shareholder of the company Retag d.o.o.
...
By a non-final decision, P-4885/03 of 13 April 2004, the Zagreb Commercial Court allowed reopening of the proceedings in that case, set aside [its] judgment P-15652/92 of 7 June 1995 and the judgment of the High Commercial Court of the Republic of Croatia Pž-3060/95 of 31 October 1995, and declared the action inadmissible.
It is correct that the bankruptcy creditor Zagrebačka banka d.d,. on 23 March 2003 brought an action [for unjust enrichment] arguing that unjust enrichment of the bankruptcy estate had occurred, which constituted [an]other obligation of the bankruptcy estate, whereby the plaintiff sought to have declared non-existent and without legal effects the judgment of the Zagreb Commercial Court P-15652/92 of 7 June 1995, as well as the judgment of the High Commercial Court of the Republic of Croatia Pž-3060/95-02 of 31 October 1995, and [asked] the court to order the bankruptcy debtor to pay the plaintiff from the bankruptcy estate the amount of HRK 168,618,419.60, together with the accrued statutory default interest. That action was declared inadmissible by a final decision of this court, P-91/04-7 of 2 April 2004.
In the case before this court, P֊270/03, the plaintiff’s action to have the continuation of enforcement ordered by the decision of the Zagreb Commercial Court, I-40/96 of 3 October 2003 ... declared inadmissible was dismissed by a non-final judgment of this court of 24 February 2004.
Without calling into question the aforementioned non-final decisions (one of them was rendered in favour and two against the bankruptcy creditor Zagrebačka banka d.d), [the fact remains that] on 22 December 2003 the amount of HRK 168,618,419.60 was transferred into the account of the bankruptcy debtor pursuant to the final writ of execution, I-40/96 of 26 January 1996. The writ of execution was upheld on appeal by a decision of the High Commercial Court of the Republic Croatia, Pž-438/96 of 12 March 1998, and was not quashed or reversed by any subsequent final decision. ...
Taking that fact into account, this bankruptcy court cannot accept as well-founded the claim of the bankruptcy creditor Zagrebačka banka d.d that there had been unjust enrichment of the bankruptcy estate, and that there is [an]other obligation of the bankruptcy estate within the meaning of the fourth sub-paragraph of section 87(1) of the Bankruptcy Act, in the amount of HRK 168,618,419.60. [This is so] because the transfer of funds into the bankruptcy estate occurred on the basis of the aforementioned final writ of execution. The non-final decision I-40/96 of 8 October 2003, [only] specified the statutory default interest applicable in the case, but this does not affect the finality of the writ of execution.
Therefore, the legal basis for enrichment exists as described above. [Thus,] there was no need to reserve funds to meet other obligations of the bankruptcy estate, since under section 87a of the Bankruptcy Act, the funds are to be reserved to meet those obligations which it can legitimately be assumed would have to be settled in the future.
Since in this case it cannot legitimately be assumed that, on the basis of the unjust enrichment of the bankruptcy estate, there are other obligations of the bankruptcy estate, the bankruptcy administrator did not reserve the amount of HRK 168,618,419.60 in the final [distribution] list. [Therefore] the objection of the bankruptcy creditor Zagrebačka banka d.d to the final [distribution] list was dismissed as ill-founded.”
82.  On 23 March 2005 the High Commercial Court dismissed an appeal by the applicant bank and upheld the first-instance decision. The relevant part of that decision reads as follows:
“The bankruptcy judge [of the first-instance court] when examining the [applicant bank’s] argument [raised] in the objection [to the final distribution list] that ... section 87a of the Bankruptcy Act have been breached ... correctly applied provisions of the Bankruptcy Act ...[T]he assessment of ... whether it could legitimately have been assumed that there existed an obligation of the bankruptcy estate on the ground of unjust enrichment to return ... the amount of HRK 168,618,419.60, was carried out on the basis of: the final decision of the Karlovac Commercial Court ... of 2 April 2004 to declare inadmissible the appellant’s action seeking that the bankruptcy debtor pay the plaintiff the amount of HRK 168,618,419.60, the final writ of execution of the Zagreb Commercial Court ... of 26 January 1996 and the [final] decision on the continuation of enforcement of 3 October 2003, ... [The bankruptcy judge of the first-instance court] therefore considered that, notwithstanding the appellant’s action for unjust enrichment brought on 22 December 2004 seeking to recover the amount of HRK 168,618,419.60, which is the amount paid in the enforcement proceedings, it could not legitimately be assumed that there existed ... an obligation of the bankruptcy estate on account of unjust enrichment, and that therefore the bankruptcy administrator had not reserved the amount of HRK 168,618,419.60 in the final [distribution] list. The appellant’s objection was therefore dismissed.
That decision [of the bankruptcy judge of the first-instance court] is ... based on the ... assessment that, having regard to the final court decisions rendered so far and the action brought on 22 December 2004, it could not legitimately be assumed that there existed an obligation of the [bankruptcy] estate on the basis of unjust enrichment to return ... the amount 168,618,419.60, HRK, and that the bankruptcy administrator was [therefore] not obliged to reserve that amount as an obligation which it could legitimately be assumed would have to be settled in the future, in accordance with the ... section 87a of the Bankruptcy Act.
According to the case file and documentation in the file, the amount of HRK 168,618,419.60 was transferred into the account of the bankruptcy debtor on 22 December 2003 on the basis of a final writ of execution of the Zagreb Commercial Court ... of 26 January 1996 and the final decision of 3 October 2003 on the continuation of the [enforcement] proceedings.
According to the case file and the claims of the appellant itself, it follows that the appellant brought its action, to which it refers, on 22 December 2004, which was 21 days after the publication in the Official Gazette on 1 December 2004 [of the notice] that a final hearing was to be held and the notice that according to the final distribution list all bankruptcy creditors were to be paid 100% of the amount of the acknowledged claim[s], after the service of the final list and after displaying the final statement of account in the office of the court on 13 December 2004, only a day before the final hearing. It is unclear how the bankruptcy administrator, in compiling the final [distribution] list ... could have foreseen that the appellant would again bring an action for [unjust enrichment seeking] payment of HRK 168,618,419.60 after the appellant’s [previous] action [for unjust enrichment], seeking .... that the bankruptcy debtor pay the plaintiff the amount of HRK 168,618,419.60 had already been declared inadmissible on 2 April 2004 in the proceedings before the Karlovac Commercial Court. It is also unclear how, on the basis of this anticipation of a new action, the bankruptcy administrator could have legitimately assumed that the amount of the claim [sought by the action] not yet brought, would have to be settled in the future.
By the action brought on 22 December 2004 [the plaintiff] is again seeking that the amount of HRK 168,618,419.60 be paid on account of unjust enrichment of the bankruptcy estate. From the facts [adduced in support] of] of the claim it does not follow that there is a legitimate assumption that this amount would have to be paid in the future. [Therefore,] the assessment [made] by the bankruptcy judge [of the first-instance court] is correct.”
83.  On 5 January 2005 the bankruptcy administrator reserved the amount of HRK 41,752,238.68 for the applicant bank and deposited it on a special account pending the final outcome of the civil proceedings the applicant bank had instituted on 4 May 1998 (see paragraphs 19 and 88-94 below).
84.  On 18 April 2005 the applicant bank lodged a constitutional complaint against the second-instance decision, asking at the same time for the distribution of the bankruptcy estate to be postponed. The Constitutional Court took no action on the postponement motion but on 7 July 2005 declared the applicant bank’s constitutional complaint inadmissible.
85.  On 15 April and 16 May 2005 the bankruptcy estate was distributed in accordance with the final distribution list. The applicant bank submitted that the creditors had received the total of HRK 4,452,789.64, whereas HRK 120,571,514.44 had been distributed to Retag’s shareholders, that is to three companies set up by Mr A.K.’s statutory heirs (his widow and three children) and the testamentary heir, a Mr B.P. As noted above (see paragraph 83), the sum of HRK 41,752,238.00 was reserved for the claims of the applicant bank. After the judgment of the Karlovac Commercial Court of 5 February 2010 rendered in the civil proceedings seeking declaration of the assignment contract between Textil and Texhol of 18 December 1995 non-existent became final (see paragraphs 93-94 below), the part of that sum, amounting to HRK 14,146,718.27, was on 14 January 2013 transferred to the applicant bank’s account.
86.  On 29 March 2007 the Karlovac Commercial Court issued a decision closing the bankruptcy proceedings against Retag.
87.  On 12 December 2007 the Karlovac Commercial Court issued a decision deleting Retag from the register of commercial companies. Retag thereby ceased to exist as a legal entity. It however continued to participate in various civil proceedings as “the bankruptcy estate of Retag” represented by its bankruptcy administrator (see paragraphs 155-156 below).
88.  Meanwhile, on 4 May 1998 the applicant bank brought a civil action against Retag in the Karlovac Commercial Court, seeking to have the assignment contract concluded on 18 December 1995 between Textil and Texhol (see paragraph 18 above) declared non-existent. The applicant bank disputed the existence of that assignment contract, claiming that on 15 March 1994 Textil had ceased to exist as a legal entity following its incorporation into company Turist Trip d.o.o. (see paragraph 19 above).
89.  After the opening of the bankruptcy proceedings against Retag on 21 June 2000 the applicant bank also asked the court to establish that as a bankruptcy creditor it had against the defendant: (1) a well-founded higher-ranking claim for restitution of HRK 11,422,427.08 on account of unjust enrichment, which claim was reported in the above bankruptcy proceedings on 21 July 2001 (see paragraph 70 above), (2) two well-founded lower-ranking claims for payment of HRK 8,156,264.47 and HRK 610,610, reported in the above bankruptcy proceedings on 29 October 2004 (see paragraph 77 above).
90.  On 18 January 2006 the Karlovac Commercial Court dismissed the applicant bank’s action in its entirety, finding that at the relevant time Textil did exist as a legal entity.
91.  Following an appeal by the applicant bank, on 16 October 2007 the High Commercial Court reversed the first-instance judgment in part and found for the applicant, declaring the assignment contract of 18 December 1995 between Textil and Texhol non-existent. It found that at the relevant time Textil no longer existed as a legal entity, following its incorporation into company Turist Trip. At the same time the High Commercial Court quashed the first-instance decision in its part dismissing the applicant bank’s ensuing demands regarding validity of its claims reported in the bankruptcy proceedings, and remitted the case in that part.
92.  On 15 July 2008 the Supreme Court declared inadmissible an appeal on points of law lodged against the second-instance decision by “the bankruptcy estate of Retag”.
93.  In the resumed proceedings, by a judgment of 5 February 2010 the Karlovac Commercial Court found for the applicant bank in part. That court established that the applicant bank, as a bankruptcy creditor had against “the bankruptcy estate of Retag”: (1) a well-founded higher-ranking claim for recovery of HRK 9,824,115.39 (instead of the HRK 11,422,427.08 sought by the applicant bank) on account of unjust enrichment, (2) two well-founded lower-ranking claims for payment of HRK 3,866,945.08 (instead of HRK 8,156,264.47 sought by the applicant bank) and HRK 455,657.80 (instead of HRK 610,610.00), reported in the above bankruptcy proceedings on 29 October 2004. The claim for recovery of 9,824,115.39 corresponds to the amount seized from the applicant bank in the enforcement proceedings on 12 February 1996 (HRK 5,416,078.56) and the statutory default interest accrued on that amount up to the opening of the bankruptcy proceedings, the claim for payment of HRK 3,866,945.08 corresponds to the statutory default interest on the amount seized from the applicant bank in the enforcement proceedings on 12 February 1996 accrued in the period between the date of the opening of the bankruptcy proceedings and the date the claim, was reported, and HRK 455,657.80 corresponds to the costs of the bankruptcy proceedings incurred by the applicant bank.
94.  Following appeals by both “the bankruptcy estate of Retag” and the applicant bank, on 31 October 2012 the High Commercial Court upheld the first-instance judgment but reduced the amount of costs of the bankruptcy proceedings awarded to the applicant bank to HRK 323.583,73.
95.  On 14 November 2003 the Zagreb County State Attorney’s Office (Županijsko državno odvjetništvo u Zagrebu) made a request to an investigating judge of the Zagreb County Court (Županijski sud u Zagrebu) asking him to open an investigation against the majority (51%) shareholder of Textil and the sole shareholder of Retag (earlier Texhol), Mr A.K., on suspicion that he had committed criminal offences of abuse of office defined in Article 337 paragraphs 1, 3 and 4 of the Criminal Code (see paragraph  158 below).
96.  On 18 November 2003 the investigating judge issued a provisional measure prohibiting the Croatian National Bank and other legal entities performing payment operations from making any payments to Retag, or a third person at Retag’s order, on the basis of the Commercial Court’s decision of 3 October 2003, that court’s instruction of 28 October 2003 or any future decision issued on the basis of the original judgment of 7 June 1995. Retag and A.K. appealed.
97.  On 10 December 2003 a three-member panel of the Zagreb County Court allowed the appeals and quashed the decision of the investigating judge of 18 November 2003. It held that it was not plausible that the suspect would dispose of the amount in respect of which the provisional measure had been imposed, because administration of Retag’s assets had since the opening of the bankruptcy proceedings been in the hands of the bankruptcy administrator and not of A.K. as the sole shareholder.
98.  On 19 December 2003 the investigating judge decided to open an investigation in respect of A.K., and thereby commenced criminal proceedings against him. He found that there was a reasonable suspicion that A.K. had committed the above criminal offence by abusing his position as the majority stockholder of Textil and the sole shareholder of Retag, with a view to obtaining an unlawful pecuniary gain in that he had: (1) on 18 December 1995 ordered the directors of those companies to sign a fictitious assignment contract whereby Textil had assigned its claim against the applicant bank on the basis of the original judgment of 7 June 1995 to Retag (at the time named Texhol) even though he had known at that time that the applicant bank had an outstanding claim against Textil in the amount of HRK 196,982.42 together with interest running from 1 May 1992, and that Textil no longer existed as a legal entity, and (2) that he had later on obtained enforcement of the assigned claim in the enforcement proceedings in the total amount of HRK 170,583,755.31 to the benefit of Retag.
99.  The applicant bank participated in these criminal proceedings as an injured party (oštećenik), and lodged a pecuniary claim seeking payment of at least HRK 170,583,755.31.
100.  On 19 September 2004 A.K. died (see paragraph 76 above). Accordingly, the criminal proceedings against him were discontinued.
101.  On 23 March 2004 the applicant bank brought a civil action for unjust enrichment against Retag in the Karlovac Commercial Court seeking: (a) to have declared non-existent and without legal effect the judgment of the Zagreb Commercial Court of 7 June 1995 and the judgment of the High Commercial Court of 31 October 1995, and (b) restitution of the amount seized from it on 22 December 2003.
102.  On 2 April 2004 the Karlovac Commercial Court declared the applicant bank’s action inadmissible. It held that a civil action was not a remedy to contest final and valid court judgments, as they could be overturned only following an appeal on points of law or other extraordinary remedies (a petition for reopening, constitutional complaint).
103.  On 10 November 2004 the High Commercial Court dismissed an appeal by the applicant bank and upheld the first-instance decision endorsing the reasons given by the first-instance court.
104.  Following an appeal on points of law by the applicant bank, on 22 September 2010 the Supreme Court quashed the decisions of the lower courts in part and remitted the case to the first-instance court. The Supreme Court upheld the decisions of the lower courts to declare inadmissible the applicant bank’s demand to declare non-existent and without legal effect the judgment of the Zagreb Commercial Court of 7 June 1995 and the judgment of the High Commercial Court of 31 October 1995. At the same time the Supreme Court quashed the lower courts’ judgments, declaring inadmissible the applicant bank’s claim for restitution of the amount seized from it on 22 December 2003.
105.  It would appear that the proceedings, currently pending before the Karlovac Commercial Court, have been stayed since 2 February 2010, when the same court issued a decision to that effect, because Retag had on 12 December 2007 ceased to exist as a legal entity (see paragraph 87 above). They will remain stayed until the defendant’s legal successor takes over the proceedings or until the court at the initiative of the plaintiff invites the successor to do so (see paragraph 145 below).
106.  On 22 December 2004 the applicant bank brought another action for unjust enrichment against Retag before the Karlovac Commercial Court seeking restitution of the amount seized from it on 22 December 2003. In so doing it argued, inter alia, that the assignment contract concluded on 18 December 1995 between Textil and Texhol had not been valid, because at that time Textil had no longer existed as a legal entity. Since that assignment contract had served as the supplementary enforcement title in the enforcement proceedings, the enforcement had been without legal basis. It followed that by receiving HRK 168,618,419.60 in those enforcement proceedings Retag had been enriched without cause (without a valid legal title). The applicant bank also argued that the amount sought also constituted proceeds of a criminal offence.
107.  On 3 April 2007 the Karlovac Commercial Court dismissed the applicant bank’s action. It held that the applicant bank could have sought counter-enforcement (protuizvršenje) under section 59(1) of the 1978 Enforcement Procedure Act and thus, pursuant to paragraph 4 of that section, could not have brought an action for unjust enrichment before the expiry of the time-limit set forth in paragraph 3 of the same section (see paragraph 146 below).
108.  The applicant bank appealed.
109.  On 26 March 2008 the High Commercial Court returned the case to the Karlovac Commercial Court with an instruction to stay the proceedings because Retag had on 12 December 2007 ceased to exist as a legal entity (see paragraph 87 above).
110.  On 30 June 2008 the Karlovac Commercial Court stayed the proceedings.
111.  Following a request by the applicant bank of 30 June 2008 for the bankruptcy administrator to be invited to take over the proceedings, on 1 August 2008 the court did so and the proceedings thereby resumed.
112.  On 24 October 2012 the High Commercial Court allowed an appeal by the applicant bank, quashed the first-instance judgment of 3 April 2007 and remitted the case. It would appear that the proceedings are currently again pending before the Karlovac Commercial Court.
113.  Meanwhile, on 11 November 2003 the applicant bank brought a civil action against Retag in the Karlovac Commercial Court, seeking that the continuation of enforcement of the original judgment in the enforcement proceedings (see paragraphs 42-66) be declared inadmissible (tužba za proglašenje ovrhe nedopuštenom). It argued that Retag’s claim against it had been extinguished by being offset against the applicant bank’s claim against Textil (see paragraph 46 above).
114.  On 24 February 2004 the Karlovac Commercial Court dismissed the applicant bank’s action.
115.  Following an appeal by the applicant bank, on 27 December 2007 the High Commercial Court quashed the first-instance judgment and remitted the case.
116.  It would appear that the proceedings, currently pending before the Karlovac Commercial Court, have been stayed since 14 February 2008 when that court issued a decision to that effect, because Retag had on 12 December 2007 ceased to exist as a legal entity (see paragraph 87 above). They will remain stayed until the defendant’s legal successor takes over the proceedings or until the court at the initiative of the plaintiff invites the successor to do so (see paragraph 145 below).
117.  In the meantime, on 9 February 2000 the applicant bank filed a petition for bankruptcy proceedings to be opened against the Turist Trip company, as the legal successor of Textil, before the Karlovac Commercial Court.
118.  On 21 June 2000 the Karlovac Commercial Court decided to open bankruptcy proceedings against Turist Trip. By the same decision the court appointed a bankruptcy administrator and invited the creditors to report their higher-ranking claims to him within twenty days of the publication of the decision to open bankruptcy proceedings in the Official Gazette. The notice was published in the Official Gazette of 7 July 2000.
119.  The applicant bank, as a bankruptcy creditor, reported to the bankruptcy administrator the claim of HRK 675,367,324.72 (that is, HRK 14,921,617.82 together with the accrued interest from 1 March 1993 until the date of the opening of the bankruptcy proceedings, see paragraph 46 above).
120. At the verification hearing held on 30 November 2001 the bankruptcy administrator acknowledged the applicant bank’s claim in the amount of HRK 181,187.11, and contested the remaining amount.
121.  On 17 September 2012 the Commercial Court issued a decision to discontinue the bankruptcy proceedings, as the assets belonging to the bankruptcy estate were insufficient to meet all the estate’s obligations. Following appeals by the applicant bank and the State Attorney’s Office, on 8 January 2013 the High Commercial Court quashed that decision and remitted the case.